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Liquidity on local money markets increase

LIQUIDITY on the local money markets was bolstered from Friday’s K806.17 million to K1.3 billion on Monday due to inflows from public payroll obligations coupled with the value added tax (VAT) refunds.
Zanaco says in the short-term, liquidity levels are expected to remain high with the weighted average overnight interbank lending rate hovering between 27.2 percent and 27.6 percent.
“The money markets experienced an increase in liquidity for the second day running to close at 1,295.27 million, up by 60.67 percent compared to the previous day’s K806.17 million,”
“Inflows for public payroll obligations coupled with the VAT refunds have been the main contributors to the rise in liquidity,” the bank says in its daily treasury newsletter.
The bank, however, says the volume of funds traded on interbank increased from K499 million to K608.90 million while the weighted average overnight interbank lending rate, which is the rate of interest charged on short-term loans made between banks, slightly softened from 27.63 percent to 27.42 percent
On the local currency market, the Kwacha is expected to continue trading in the range of K11.33 and K11.45 in the near-term due to the increased United States (US) dollar demand from corporates intending to settle post month-end obligations
Zanaco says the Kwacha remained unchanged against the dollar on Monday for a fourth consecutive session but, was down 1.1 percent for the month of February.
The local unit opened trading unchanged from Friday’s close of K11.37 and K11.39.
On the regional front, the Kenyan shilling appreciated to K101.564 on Tuesday from 101.899 on Monday, South African rand to 15.834 from 15.854 while Botswana pula depreciated to 11.458 from 11.452.
However, the Malawian Kwacha remained unchanged at 754.455.

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